First Home Partner Scheme
You want to buy your first home but don’t have sufficient funds considering the home loan that you can get potentially and your deposit that you have available. First Home Partner might be able to help you get your foot onto the property ladder.
What is First Home Partner?
First Home Partners is a shared ownership scheme to help aspiring First Home buyers whose deposit and home loans are not quite enough to buy a home.
The way that it works is that Kainga Ora contributes up to 25% of the value of the property, or up to $200k, whichever is the lower amount.
You would need to meet the lending requirements of a participating bank to qualify.
What is shared ownership?
You are the majority owner and Kainga Ora will not use or occupy your home.
There are some important differences from owning your own home outright that you would need to consider:
· Kainga Ora will share ownership of the home with you, in the form of tenants in common. This is where two or more parties purchase a property together
and each has a specified share in the home.
· The shared ownership relationship between you and Kainga Ora is governed by a Shared Ownership agreement.
· You need to commit to live in the property for at least 3 years from settlement and take full ownership of the property within 15 years of the settlement date.
· You would need to meet annually with a Kainga Ora Relationship Manager to review the financial circumstances of your household. You need to do your
best to purchase the shared owned by Kainga Ora and work towards the goal of full home ownership within a 15 year time frame.
· You would need permission from Kainga Ora before making improvements or renovations, or if you want to sell your home.
Eligibility criteria
To qualify you need to:
· You must be over 18 years old.
· Be a New Zealand Citizen or Permanent Resident or a resident visa holder who is ordinarily resident in New Zealand or apply with someone who meets the
citizenship or residency requirements.
· Have a total household income of less than $150k per year.
· Have a good credit rating.
· Be a first home buyer or qualify as a previous homeowner.
· Not previously received shared ownership support from Kainga Ora.
Deposit Breakdown
You need to be able to approve that you have a minimum of 5% of the purchase price of the home.
This can include:
· Your KiwiSaver 1st home withdrawal
· First home grant
· Gift from family
· Your own savings
· Sale of an assert like a car.
What sort of properties are acceptable?
· New build- This means the home is s new build that has not been previously occupied (other than by the developer or builder) and has received a Code of
Compliance Certificate in the previous 12 months or purchased off the plan.
· First Home Partner does not support buying a piece of land and you getting a builder to complete the build in the form of schedular payments.
· The home must be habitable from day one and be acceptable to the bank as security.
What is the process?
You need to apply with Kainga Ora for approval to be part of the First Home Partner scheme.
Kainga Ora will give you an estimate of how much they are prepared to provide as part of your deposit. Kainga Ora will process your application within 5 working days, and it is valid for a period of 6 months.
Once you have approval from Kainga Ora, we can work with you on a bank application to confirm that you can borrow the remainder of the funds to purchase the property.
We highly recommend that you engage the services of a solicitor before entering into an agreement under the First Home Partnership scheme, as it is different than what you would experience with buying your own property outright.
We can help you with the application with the bank.
Book a Free consultation.